How Will Bankruptcy Affect My Child Support Obligations?

You cannot discharge child support debt in Chapter 7 or Chapter 13 bankruptcy.

If you’re paying child support, bankruptcy won’t wipe out what you owe now or modify your future payments. Even so, bankruptcy can help. Here are a few things you’ll want to know:

  • The automatic stay won’t stop child support from accruing or delay most family law proceedings.
  • The bankruptcy trustee appointed to the case has child support reporting requirements.
  • When money is available to pay creditors, the trustee pays child support arrearages first.
  • In Chapter 7 bankruptcy, you’ll remain responsible for child support and property division balances after the case closes.
  • In Chapter 13 bankruptcy, you’ll pay off child support arrearages over three to five years, but you might be able to wipe out a property division balance.

Bankruptcy Won’t Stop Child Support Payments

Filing for bankruptcy prevents most creditors from collecting debts from you. Once the automatic stay goes into effect, a creditor must get permission from the court before continuing or initiating a collection action. But the automatic stay doesn’t apply to most child support procedures, including:

  • legal proceedings to establish or modify a child support order
  • collection of child support from property not part of the bankruptcy estate (such as post-filing Chapter 7 wages), or
  • income withholdings to pay child support under an administrative or court order or statute.

Other types of lawsuits you can’t stop with bankruptcy include criminal actions and suits that should move forward in the interest of justice. For instance, because the bankruptcy court needs a fraud trial judgment before declaring a debt nondischargeable due to fraud, the court would likely allow an ongoing fraud trial to proceed to judgment.

Learn more about when a court will lift the automatic stay.

Bankruptcy Trustees Must Report Child Support Obligations

The trustee will ask debtors owing child support to complete a form at the 341 meeting of creditors, the one hearing all bankruptcy filers must attend. You should be prepared to provide your current address, your last or current employer’s address, and information about your support obligation, including the name and address of the person to whom you owe it.

The trustee will use the information to inform the holder of the domestic support order of bankruptcy payment rights and the availability of child support collection services through the applicable state enforcement agency. Both the domestic support holder and the state enforcement agency will also receive notice of the bankruptcy discharge and collection information.

Child Support Payments in Chapter 7 and 13 Bankruptcies

You can’t wipe out a child support obligation in bankruptcy—it’s nondischargeable. It’s also a “priority debt” that receives special treatment in bankruptcy. If money is available to pay creditors, child support obligations get paid first.

  • In Chapter 7 bankruptcy, if the Chapter 7 trustee sells property that you can’t protect with a bankruptcy exemption, the funds will be applied to the support obligation (after deducting costs—learn how trustees get paid). Even if you complete your bankruptcy case and receive a discharge, you’ll remain responsible for any child support balance and all amounts that come due after filing.
  • In Chapter 13 bankruptcy, you can catch up on your missed child support payments. All arrearages must be paid back in full through your Chapter 13 repayment plan, and you must continue to make your ongoing child support payments. Before you can receive a Chapter 13 discharge, you must certify to the court that you are current on all alimony and child support obligations. Because a Chapter 13 plan cannot exceed five years, excessive child support arrearages can lead to a high monthly plan payment.

Learn more about the differences between Chapters 7 and 13.

Wiping Out Property Division Debt in Chapter 13 Bankruptcy

Sometimes divorcing couples divide property unevenly. One spouse will take more assets and agree to pay the property’s value to the other over time, memorializing the transaction in a property division agreement. Why does this matter? Although a support obligation isn’t dischargeable in Chapter 13, a debtor can eliminate a property division debt—a fact that can take the unwary by surprise.

This information comes with several caveats, however. A property division debt discharge isn’t available in Chapter 7, and the property division agreement must be specific. If the bankruptcy court can’t separate the amounts intended for support and the property division, the court won’t discharge the property division portion (and you’ll likely need to pay the full amount). Also, not all jurisdictions handle these issues in the same way, so be sure to speak with a local bankruptcy lawyer about the procedures where you live or plan to file.

Meet With a Bankruptcy Lawyer

If you’re considering filing for bankruptcy and you owe child support, talk with a bankruptcy attorney. The lawyer will be able to explain your options and help you make the best choice for you. Plus, many offer a free initial consultation.

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